GSCW chat: How transportation and logistics stocks will fare in 2022

BIO: Holm has 15 years of experience as an equity research analyst. Prior to launching West Brow, he was a senior research analyst at FreightWaves.

KEY QUOTES FROM HOLM:

On the outlook for TL stocks: “Truckload to me is more mid to late cycle. You’re likely to only make your money from earnings growth there because the multiples are kind of capped, everybody’s waiting for the market to roll over. Investors just aren’t going to reward you with a peak multiple on earnings when spot rates are at $4 because they don’t believe they can last.”

On which transport stocks could do well: “I kind of like the setup for freight brokerage in 2022. They tend to be more mid- to late-cycle stocks and if you finally do see that $4 spot rate come in a little bit and then the freight backdrop stays strong which it’s likely to do … I think that would favor the brokers.”

Overall take on the market: “I’m sort of actually optimistic on the market now that it’s had its 10 or 20% correction. … I think the key that would really create a rally is if we see inflation kind of moderate unexpectedly and the Fed can kind of back away from such aggressive interest rate hikes.”

Click for more FreightWaves articles by Todd Maiden.

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